Carrollton-Farmers Branch Independent School Dist. v. Johnson & Cravens

• Decision Date: 21 November 1989
• Docket Number: No. 87-1835,CARROLLTON-FARMERS,87-1835
• Citation: 889 F.2d 571
• Parties: BRANCH INDEPENDENT SCHOOL DISTRICT and City of Farmers Branch, Plaintiffs-Appellants, v. JOHNSON & CRAVENS, 13911, Inc., et al., Defendants, Federal Deposit Insurance Corporation as manager of the FSLIC Resolution Fund as successor to the Federal Savings and Loan Insurance Corporation, as receiver for First Savings Association of Burkburnett, Texas, Defendant-Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 571

889 F.2d 571

CARROLLTON-FARMERS BRANCH INDEPENDENT SCHOOL DISTRICT and City of Farmers Branch, Plaintiffs-Appellants, v. JOHNSON & CRAVENS, 13911, Inc., et al., Defendants Federal Deposit Insurance Corporation as manager of the FSLIC Resolution Fund as successor to the Federal Savings and Loan Insurance Corporation, as receiver for First Savings Association of Burkburnett, Texas, Defendant-Appellee.

No. 87-1835.

United States Court of Appeals Fifth Circuit.

Nov. 21, 1989.

572>>Earl Luna, Sydna H. Gordon, Dallas, Tex., for Carrollton Farmers Branch In dependent School Dist.

Christopher J. Caso, Hutchison, Price, Boyle & Brooks, Dallas, Tex., for City of Farmers Branch.

Robert B. Wellenberger, Robert O. Lamb, Dallas, Tex., for F.S.L.I.C.

Appeals from the United States District Court for the Northern District of Texas.

(Opinion Oct. 27, 1988, 5th Cir. 858 F.2d 1010)

Before GEE, ¹ RUBIN, and SMITH, Circuit Judges.

ON PETITION FOR REHEARING

PER CURIAM:

We have recalled the mandate in order to reconsider the plaintiffs' petitions for rehearing in light of the intervening decision in Coit Independence Joint Venture v. Federal Savings & Loan Ins. Corp., --- U.S. ----, 109 S.Ct. 1361, 103 L.Ed.2d 602 (1989). We now vacate our prior opinion, 858 F.2d 1010 (5th Cir.1988) modified 867 F.2d 1517 (5th Cir.1988), and remand for further proceedings in accordance with Coit. We and the parties hereto are in agreement that in the wake of Coit, the portion of our opinion that relied upon North Miss. Sav. & Loan Ass'n v. Hudspeth, 756 F.2d 1096 (5th Cir.1985), cert. denied, 474 U.S. 1054, 106 S.Ct. 790, 88 L.Ed.2d 768 (1986), cannot stand.

Two other intervening developments call for our attention. First, the parties have informed us, in supplemental briefs, that the Federal Savings & Loan Insurance Corporation (FSLIC), which has now been succeeded in interest by defendant Federal Deposit Insurance Corporation (FDIC), has sold the property on which the plaintiffs seek to collect taxes. Second, Congress has enacted the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA), Pub.L. No. 101-73, 103 Stat. 183 (1989).

The enactment of FIRREA resolves any jurisdictional uncertainties in the matter sub judice. Section 407 of FIRREA repeals 12 U.S.C. Sec. 1730(k)(1), upon which our prior opinion herein heavily relied, see 858 F.2d at 1012-16; and section 209 of FIRREA amends 12 U.S.C. Sec. 1819 to expand federal jurisdiction where the FDIC is a party. This statutory change is aptly explained in our recent opinion in Triland Holdings & Co. v. Sunbelt Serv. Corp., 884 F.2d 205, 207-08 (5th Cir.1989). The text of amended section 1819 is set forth in relevant part in Triland, id. at 207.

As we explained in Triland, the new section expands federal jurisdiction to all suits to which the FDIC is a party, with one exception pertinent here: where the FDIC was appointed, as receiver, exclusively by state authorities. Here, as we noted in our prior opinion, 858 F.2d at 1011, FSLIC was appointed, as receiver, by both the appropriate state authority and the Federal Home Loan Bank Board. Hence the exception, which is codified at 12 U.S.C. Sec. 1819(b) (2)(D)(i), does not apply to this case, and section 1819(b) (2)(A) confers original jurisdiction while section 1819(b) (2)(B) provides removal jurisdiction.

This circumstance is unaffected by the apparent sale of the subject property. First, the fact of the sale, if arguendo problematical, appears to raise more a question of mootness than an issue of federal subject matter jurisdiction....